Cut KIZ and R&D Tax Credit Programs Could Hurt Pittsburgh Startups-What You Can Do About It

Photo by Kevin Myers

A number of tax credit programs that help grow startups and other businesses and provide jobs and other economic resources in western Pennsylvania could be in a two-year long hiatus starting July 1st. Two of the programs to be cut are the Keystone Innovation Zone (KIZ) and Research & Development (R&D) Tax Credit programs. Although, it may seem like a quick fix for the budget deficit to lawmakers, it could do long-term damage to the region's economic development, taking millions of necessary incentives away from Pittsburgh startups.

The credit provides small businesses a 20 percent tax credit and large businesses a 10 percent tax credit for increased expenditures on R&D in Pennsylvania. What's important, Russo said, is that small businesses have the ability to sell unused credits to other Pennsylvania businesses, which is "enormously" helpful for cash-strapped startups. 

She [Pittsburgh Tech Council President, Audrey Russo] said the credit is equally essential to the state's traditional manufacturing economy, which faces constantly changing markets where innovation is essential to survival and job retention. 

"For all of these reasons, the Pittsburgh Technology Council is urging legislators to explore other options to balance this year’s budget that will have less of an affect on the states advanced manufacturing, life sciences and information technology-related industries," Russo writes.

The Tech Council has set up an online tool to send a note to legislators.

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